VIRTUAL AUCTIONS TAKING OFF

Online Auctioning is gathering momentum, as reported in Kondinin Group’s Farming Ahead:

ANGUS STREET believes we are on the cusp of seeing an Amazon-style disruption of the livestock marketplace in Australia. As the CEO of Auctions Plus he has a ringside seat in watching the disruption.

“Technology is changing so fast that we talk about what is happening today, rather than what is happening in the future,” Angus said.

Auctions Plus, which is currently the only online livestock auction market place in Australia, has risen from humble beginnings in the late 1980s.

“We are a 32-year-old start-up,” Angus said. “Our business was developed pre-internet, and our first sale was in 1987.”

But it’s been in recent years that online livestock sales have taken off and Auctions Plus has seen a dramatic increase with uptake immediately following updates to their platform and technology.

Last year, 3.05 million sheep were listed on Auctions Plus, with around 80-85% of them selling, making it the largest livestock market place in Australia.

Angus is adamant that the online auction place is a better option for farmers and livestock.

“The sheep only leave the property after they are sold,” he said.

“They are only loaded and unloaded once – rather than needing to go through the stress of the saleyard. Less stress is better for animal welfare and also for meat quality. Because they go directly from one property to another, there is less biosecurity risk.”

“Very rarely do you see people who send sheep to a saleyard go in and get them again. The seller loses control when the sheep get loaded onto the truck and go to the yards. With Auctions Plus, the sheep stay on the farm until after they are sold and then they are trucked to the buyer’s place at the buyer’s expense. The seller keeps control of the sale.

“But the system only works if there is trust. We’re working to develop that trust online that gives the confidence you get with a handshake.”

The Auctions Plus sales model begins with a trained and accredited assessor making an assessment of the animals to be sold. Assessors use a set of standard criteria, which include objective and subjective measurements.

The livestock are then put up for sale on the website. The auction happens in real time – sheep sales are held on Tuesdays and Thursdays, and cattle sales on Wednesdays and Fridays – with buyers logging in and bidding as the auction proceeds.

It’s not like eBay, where you can lodge a bid at any time; it’s more like a traditional saleyard auction, except online.

“By having the auction at a particular time, we maximise the number of bidders,” Angus said. “we may have anywhere from 400 to 500 potential bidders logged in, which means we maximise competition.

“Our buyers have assurance that they are getting what they bid for because the assessments that are lodged on the website by our assessors are legally binding contracts. We have misdescription and arbitration processes in place to protect the buyer, but very rarely do we have problems.

“Our descriptors are aligned as best we can to industry guidelines but many descriptors used in the industry are very conversational. We are working towards making them more objective. We’re tracking body score dressing percentage.”

Angus doesn’t think the online marketplace will completely take over from the traditional saleyard, and sees social value in traditional saleyards. Some agents seek to mimic that social cohesion by holding physical events in their local communities at which they livestream an online auction on a big screen.

Stock Agent Col Thexton from IRA Pemberton does just that and in December 2018 held his 27th annual sale at the Pemberton Sports Club (WA).

In his opening remarks at the start of the auction, Michael Corcoran from Auctions Plus commented that that the IRA sale was Auctions Plus’s longest standing annual sale.

By the time bidding opened, over 2200 views had been clocked up for the 71 lots on offer.

Those views came from almost 400 registered users and around 1800 guest users.

And about 30 people gathered at the live streaming of the auction. As the bids rolled in, the photos of the various lots were displayed on the big screen, with the live bidding shown on another screen.

Col has built his business on the online platform since 1990 and says he wouldn’t do it any other way.

“It’s hot out there today,” Col said, pointing out the window of the air-conditioned Sports Club.

“If this was a traditional auction, the stock would be standing out there on the concrete, no shade, no water. Nothing. They would have been there since yesterday.
“The care of the stock is so much better this way,” he said.

“They’re not sitting around in the yards with no food or water for 24 hours. Stock can get knocked around during transport and at the saleyards.

“It’s much better for the seller too. When you send them into saleyards, you don’t know what price you’re going to get. If you’ve paid to truck stock to a saleyard, you accept the going price. You don’t want to pay again to truck them home. With the online auction, the stock stay on the farm until you know you’ve sold them.”

Angus said that while Auctions Plus is the only player operating in this space at present, he is certain that will change in the future.

“Competitors will come,” he said. “And we would welcome that.”